Choosing the Type of Nonprofit Organization in India

This document describes the different types of nonprofit organizations (NPOs) in India (trusts, societies and Section 25 companies). It details registration requirements for each institutional type, tax exemption requirements, and registration to receive foreign funds.

The paper states that:

• The laws applicable to NPOs in India only recognize charitable purposes and religious purposes for their formation;
• The terms not-for-profit and nonprofit/s do not exist in Indian statute books;
• As long as the NPO is not established for, or carries out any, unlawful activity, the law in India provides a fairly conducive environment for the development and growth of all lawful charitable purposes;
• The legal framework in India gives nonprofits a choice to register either as a trust, society or company:
  • Trusts offer autonomy in management and administration;
  • Generally schools, colleges and hospitals established by wealthy families or corporate houses are founded as trusts;
  • Grassroots level organizations, which require greater public participation and involvement by way of membership, are registered as societies.

The paper provides information about the processes of registering trusts, societies, companies, registration for tax exemption, Permanent Account Number, and registration for Seeking Foreign Funds.

It concludes by presenting a detailed profile of The Centre for Advancement of Philanthropy.